Rhian Nicholson
02.02.10 17:01
UK confectioner Cadbury (CBRY) officially fell into Kraft’s arms today after shareholders voted the £11.7 billion takeover through.
The US processed food giant received the backing of 72% of shareholders, according to Kraft, after sweetening its offer to 840p plus a 10p dividend per share in a move which won over the reluctant Cadbury board.
It needed 50% plus one share to bring its five-month bid to a successful conclusion and 75% to delist Cadbury shares in London – and bring the confectioner’s 186-year history as an independent company to a close.
Shareholders still have the option to accept, with the final offer remaining open until further notice.
Analysts were expecting the takeover to be comfortably passed after US firm Hershey and Italian chocolate group Ferrero both ruled themselves out of the running.
The improved Kraft offer valued Cadbury shares at a 50% premium to the price ruling in the market immediately before Kraft made its initial approach back in September.
However, while this found favour with smaller shareholders, institutional investors took more convincing. Legal & General (LGEN) maintained in late January that the deal “fails to fully reflect the long-term value of the company”.
Meanwhile, Kraft’s largest shareholder Warren Buffett said he had “a lot of doubts about the deal”. He said he would vote against the move at the end of January.
Cadbury’s 45,0000 strong workforce was also up in arms with many descending on London earlier today to urge the British government to do all it can to safeguard jobs.
Kraft chief executive Irene Rosenfeld is looking to make annual cost savings of $675 million when the companies join forces – and analysts say this will mean job cuts.
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